When eBay asked users to change their passwords on Tuesday, it set off a firestorm of speculation. We don’t know much beyond the fact that a cyber attack compromised a database that contained encrypted passwords and other non-financial data. eBay said it’s not likely hackers could crack the encrypted passwords.

While eBay sorts through the details for members -- which include millions of buyers and sellers who conducted $205 billion worth of business in 2013 -- many enterprises are left wondering who’s next and what more they can do to avoid becoming the next technology news headline.

We caught up with TK Keanini, CTO at network security firm Lancope, to get his take on what the eBay breach really means in the context of enterprise security. He told us this is an unfortunate event but the reality is that all companies need to be ready for it to happen.

“Some companies are more ready than others. For example, eBay should programmatically force a reset of all passwords because just asking nicely will be ignored by too many,” Keanini said. “They also should offer a two-factor authentication method as others have done. All of these things help raise the cost to attackers.”

How to Guard Your Company

We also turned to Jeff Davis, vice president of engineering at security firm Quarri Technologies, to get his thoughts on what really happened. He told us it sounds like eBay’s systems were exposed when attackers managed to steal eBay employees’ account credentials. So what can other companies hoping to avoid eBay’s fate do to protect themselves?

Davis offered several options. First, you could disconnect sensitive systems from public networks, and require employees to be physically present inside secure facilities to access those systems, he said. However, he admited this is obviously impractical for a lot of organizations.

“Another approach is to use modern security software that can provide active defense against credential-stealing malware on employees’ machines,” Davis said. “This kind of thing is especially important when employees are out of the office or using their own laptops, where the security state of the local network and device are less well known.”

Does Encryption Stand a Chance?

Employees are the biggest threat to a company's security when it comes to data breaches, and a compromised employee login is a serious thing since many companies don’t keep current records of who has access to what data. At least that’s what Tom Smith, vice president of business development and strategy at CloudEtnr, a division of the French identity management firm Gemalto, told us.

“[That makes] it simple for hackers to cause damage or extract data before detection of a breach as in eBay’s case,” Smith said. “eBay discovered a database of consumer personally identifiable information or PII was compromised including encrypted passwords, emails, physical addresses, phone number, and date of birth.”

Although eBay downplayed the issue because passwords were encrypted, Smith said the information provides tremendous ammunition for the hackers to go after these individuals in both a consumer context and a professional context.

“Encrypted passwords won’t stand a chance when moved offsite to a hacker environment, and much of the personal data taken doubles as commonly used usernames or security questions for other accounts, essentially removing 75 percent of the security barriers that Web sites put up,” Smith said. “And those who have changed their passwords are not exempt, password reuse is an epidemic.”

Smith is certain of one thing: If the database was successfully harvested from eBay, these hackers will identify high-value targets and execute scripts to cross reference databases across the Internet to ultimately discover inroads to other online accounts or networks for their own gain.

“The best thing those affected can do is change the passwords of any sites reusing that of eBay and implement two-factor authentication on their accounts,” he added.

It's just not true that financial information wasn't compromised in the hacking. Two days before Ebay went public with the hacking, I was asked to verify my credit card information while attempting to change my password online (before the announcement that we should all change them). When I called Ebay with problems, using the number on a screen which itself may have been a con, a guy asked me for verifying info about my identity. Things like the color of my vehicle, home purchase info, etc that I was surprised that Ebay even had. After the announcement, I realized I needed to cut off the credit card because it absolutely was involved. Companies should be completely honest and transparent, instead of primarily focused on dividends. They will get more dividends if they are honest about their faults, limitations and breaches.

suresh:

Posted: 2014-05-23 @ 7:09am PT

Interesting article. Though customer data is encrypted forcing them to reveal sensitive information will risk opening them up to identity theft, moreover requiring users to provide secondary security information like answers to secret questions can be avoided which limits the user data that's been exposed. I work for McGladrey and there's a whitepaper on our website that offers good information on our website that readers of this article will be interested in @ http://bit.ly/1c0f35M